“escapement of income”

ReassessmentSection 147Section 1473,765 judgments

The decision most relied on for escapement of income is CIT v. Kelvinator of India Ltd. (320 ITR 561), cited in 1,673 judgments on BharatTax.

Leading authorities on escapement of income

CIT v. Kelvinator of India Ltd.

320 ITR 561 · 2010 · Supreme Court

1,673

citing judgments

An Assessing Officer cannot initiate reassessment proceedings under Section 147 of the Income Tax Act based on a mere change of opinion. Reassessment is permissible only when there is fresh tangible material leading to the belief of income escapement, not merely a review of existing facts.

ACIT v. Rajesh Jhaveri Stock Brokers Pvt. Ltd.

291 ITR 500 · 2007 · Supreme Court

1,030

citing judgments

For initiating reassessment proceedings under Section 147, the Assessing Officer needs only prima facie material providing a reason to believe that income has escaped assessment. Conclusive proof or the sufficiency/correctness of the material is not required at the stage of issuing the notice under Section 148.

Raymond Woollen Mills Ltd. v. ITO

236 ITR 34 · 1999 · Supreme Court

862

citing judgments

For reassessment proceedings under Section 148, the Assessing Officer only needs prima facie material to have a reason to believe income has escaped assessment. Conclusive proof or evaluation of the sufficiency and correctness of such material is not required at the stage of issuing the notice.

CIT v. Sun Engineering Works (P) Ltd.

198 ITR 297 · 1992 · Supreme Court

814

citing judgments

A court's pronouncement derives its scope and color from the specific questions involved in the case, thus, due regard must always be given to the questions framed before the court when interpreting its judgment.

ITO v. Lakhmani Mewal Das

103 ITR 437 · 1976 · Supreme Court

721

citing judgments

For reassessment proceedings, the 'reason to believe' that income has escaped assessment must be based on some material and not mere suspicion, establishing a live link between the information and the belief. Furthermore, for reassessment beyond four years, there must be a specific finding of the assessee's failure to disclose fully and truly all material facts.

Hindustan Lever Ltd. v. R.B. Wadkar

268 ITR 332 · 2004 · High Court

695

citing judgments

The validity of reassessment proceedings initiated under Section 147, by issuing a notice under Section 148, must be judged solely on the reasons originally recorded by the Assessing Officer. These recorded reasons cannot be supplemented, improved upon, or modified at any later stage.

CIT v. Jet Airways (I) Ltd.

331 ITR 236 · 2011 · High Court

694

citing judgments

The Assessing Officer loses jurisdiction and the entire reassessment becomes invalid if no addition is made in respect of the income that formed the basis of the reopening. Explanation 3 to Section 147 does not permit assessing other escaped income unless an addition is made for the original income forming the reason to believe.

PCIT v. Meenakshi Overseas Pvt. Ltd.

395 ITR 677 · 2017 · High Court

471

citing judgments

Reassessment proceedings initiated solely based on an investigation wing/appraisal report, without the Assessing Officer's independent application of mind to form a 'reason to believe' that income has escaped assessment, are beyond jurisdiction, bad in law, and void ab initio.

Judgments citing escapement of income

Shree Ginger Enterprises Ltd., Mumbai vs. DCIT - CC- 5(3), Mumbai

In the result, all the appeals by the assessee are partly allowed for statistical purpose

ITA 6377/MUM/2018[2015-16]Status: DisposedITAT Mumbai19 Oct 2022AY 2015-16

Bench: Shri Om Prakash Kant & Shri Sandeep Singh Karhail

For Appellant: NoneFor Respondent: Shri Manoj Kumar

Section 133ASection 143(2)Section 147Section 148Section 250

relevant. In other words, at the initiation stage, what is required is "reason to believe", but not the established fact of escapement of income. At the stage of issue of notice, the only question is whether there was relevant material on which a reasonable person could have formed a requisite

Shree Ginger Enterprises Ltd, Mumbai vs. DCIT Cen Cr 5(3), Mumbai

In the result, all the appeals by the assessee are partly allowed for statistical purpose

ITA 1334/MUM/2018[2014-15]Status: DisposedITAT Mumbai19 Oct 2022AY 2014-15

Bench: Shri Om Prakash Kant & Shri Sandeep Singh Karhail

For Appellant: NoneFor Respondent: Shri Manoj Kumar

Section 133ASection 143(2)Section 147Section 148Section 250

Shree Ginger Enterprises Ltd, Mumbai vs. DCIT Cen Cr 5(3), Mumbai

In the result, all the appeals by the assessee are partly allowed for statistical purpose

ITA 1333/MUM/2018[2013-14]Status: DisposedITAT Mumbai19 Oct 2022AY 2013-14

Bench: Shri Om Prakash Kant & Shri Sandeep Singh Karhail

For Appellant: NoneFor Respondent: Shri Manoj Kumar

Section 133ASection 143(2)Section 147Section 148Section 250

Shree Ginger Enterprises Ltd, Mumbai vs. DCIT Cen Cr 5(3), Mumbai

In the result, all the appeals by the assessee are partly allowed for statistical purpose

ITA 1332/MUM/2018[2011-12]Status: DisposedITAT Mumbai19 Oct 2022AY 2011-12

Bench: Shri Om Prakash Kant & Shri Sandeep Singh Karhail

For Appellant: NoneFor Respondent: Shri Manoj Kumar

Section 133ASection 143(2)Section 147Section 148Section 250

Shree Ginger Enterprises Ltd, Mumbai vs. DCIT Cen Cr 5(3), Mumbai

In the result, all the appeals by the assessee are partly allowed for statistical purpose

ITA 1331/MUM/2018[2010-11]Status: DisposedITAT Mumbai19 Oct 2022AY 2010-11

Bench: Shri Om Prakash Kant & Shri Sandeep Singh Karhail

For Appellant: NoneFor Respondent: Shri Manoj Kumar

Section 133ASection 143(2)Section 147Section 148Section 250

Shree Ginger Enterprises Ltd, Mumbai vs. DCIT Cen Cr 5(3), Mumbai

In the result, all the appeals by the assessee are partly allowed for statistical purpose

ITA 1330/MUM/2018[2009-10]Status: DisposedITAT Mumbai19 Oct 2022AY 2009-10

Bench: Shri Om Prakash Kant & Shri Sandeep Singh Karhail

For Appellant: NoneFor Respondent: Shri Manoj Kumar

Section 133ASection 143(2)Section 147Section 148Section 250

Shree Ginger Enterprises Ltd, Mumbai vs. DCIT Cen Cr 5(2), Mumbai

In the result, all the appeals by the assessee are partly allowed for statistical purpose

ITA 2641/MUM/2017[2012-13]Status: DisposedITAT Mumbai19 Oct 2022AY 2012-13

Bench: Shri Om Prakash Kant & Shri Sandeep Singh Karhail

For Appellant: NoneFor Respondent: Shri Manoj Kumar

Section 133ASection 143(2)Section 147Section 148Section 250

Sangeetkumar Sawarmal Hisaria, Mumbai vs. Dy CIT -CC-2(4), Mumbai

ITA 785/MUM/2021[2011-12]Status: DisposedITAT Mumbai17 Oct 2022AY 2011-12

Section 132Section 143(3)Section 147Section 148Section 153A

bogus purchase, from hawala dealers, for a sum of 8,57,78,280/-. Basis of forming reason to believe and details of escapement of Income: In the light of above facts and detailed findings, I have Reason to believe that 28,57,78,280/- has escaped assessment within the meaning

Keystone Realtors Private Limited, Mumbai vs. Deputy Commissioner of Income Tax - Central Circle 2(4), Mumbai

In the result, appeal filed by the assessee is dismissed

ITA 951/MUM/2018[2007-08]Status: DisposedITAT Mumbai17 Oct 2022AY 2007-08

Bench: Shri Aby T Varkey & Shri Gagan Goyal

For Appellant: Sh. Naresh KumarFor Respondent: Sh. Anil. S. Sant, Sr.DR

Section 115JSection 132(1)Section 143Section 143(3)Section 148Section 153A

escaped assessment has been held in plethora of case laws that at the time of reopening AO is not required to establish the escapement of Income. Keystone Realtors Pvt. Ltd. The existence of reason is enough in this regard; reliance is placed on following case laws of the Apex Court ... based on survey action that several new facts came to light and several discrepancies in the accounts of assessee were discovered which indicated escapement of income thus reopening was held valid. Yogendra Kumar Gupta Vs. ITO (51 taxmann.com 383 (SC)/[2014] 227 Taxman 374):- Where subsequent to completion of original

M/S. Kwality Biscuits Private Limited, Bangalore vs. Deputy Commissioner of Income Tax, Circle- 11(5), Bangalore

In the result, the appeal of the assessee is partly allowed

ITA 675/BANG/2020[2006-07]Status: DisposedITAT Bangalore17 Oct 2022AY 2006-07

Bench: Shri George George K. & Ms. Padmavathy Sassessment Year : 2006-07

For Appellant: Shri Narendra Sharma, AdvocateFor Respondent: Smt. Priyadarshini Baseganni, Addl.CIT(DR)(ITAT)

Section 115Section 115JSection 143(3)Section 147Section 148Section 250Section 55(2)

assessee thereby reduced book profits for the purpose of section 115JB of the Act. The AO held that there is an escapement of income to this extent and therefore asked the assessee to furnish the return of income. The assessee vide letter dated 18.10.2012 requested the AO to treat ... reasons recorded by the AO (Assessing Officer) is sufficient even when the reasons did not spell out that the Page 10 of 16 escapement of income was due to failure on the part of the assessee to disclose fully and truly all the material facts necessary for making assessment

ITO 1(2)(3), Mumbai vs. M Pallonji Enerprises P. Ltd, Mumbai

In the result, the appeal of the In the result, the appeal of the Revenue is dismissed whereas dismissed whereas cross objection of the assessee is allowed

ITA 1907/MUM/2017[2009-10]Status: DisposedITAT Mumbai13 Oct 2022AY 2009-10

Bench: Shri Amit Shukla () & Shri Om Prakash Kant () Assessment Year: 2009-10 Ito-1(2)(3), M/S M Pallonji Enterprises Pvt. Ltd., R. No. 527, 5Th Floor, Aayakar 46/A, Cawasji Patel Street, Fort, Bhavan, M.K. Road, Vs. Mumbai-400020. Mumbai-400020. Pan No. Aafcm 3357 A Appellant Respondent

For Appellant: Dr. K. Shivaram, Sr. Adv. &For Respondent: Mr. T. Shankar, CIT-DR

Section 68

what is required is within a period of four years, then what is required is 'reason to believe' but not established fact of escapement of income. At this stage believe' but not established fact of escapement of income. At this stage believe' but not established fact of escapement of income ... consequence of this sessment acts contrary to the law. If as a consequence of this there is escapement of income, the jurisdictional requirement of there is escapement of income, the jurisdictional requirement of there is escapement of income, the jurisdictional requirement of section 147 is fulfilled on the confirmation

R.Rajagopal Tondaiman, Trichy vs. DCIT Central Circle-1, Trichy

In the result, the appeal filed by the assessee is allowed

ITA 525/CHNY/2020[2010-11]Status: DisposedITAT Chennai12 Oct 2022AY 2010-11

Bench: Shri V. Durga Rao & Shri Manoj Kumar Aggarwalआयकर अपील सं./I.T.A. No.525/Chny/2020 िनधा"रण वष"/Assessment Year: 2010-11 Sri R. Rajagopal Tondaiman, Vs. The Deputy Commissioner Of Old No. 4-D, New No. 22, Collector Income Tax, Office Road, Trichy 620 001. Central Circle 1, Trichy. [Pan:Afbpr0712E] (अपीलाथ"/Appellant) (""थ"/Respondent) अपीलाथ" की ओर से / Appellant By : Shri R. Viswanathan, Ca ""थ" की ओर से/Respondent By : Shri G. Johnson, Addl. Cit सुनवाई की तारीख/ Date Of Hearing : 15.09.2022 घोषणा की तारीख /Date Of Pronouncement : 12.10.2022 आदेश /O R D E R Per V. Durga Rao: This Appeal Filed By The Assessee Is Directed Against The Order Of The Ld. Commissioner Of Income Tax (Appeals) 1, Trichy, Dated 30.12.2019 Relevant To The Assessment Year 2010-11. 2. Facts Are, In Brief, That The Assessee Is A Hereditary Of Raja Of Pudukottai & Stated That He Is Assessed To Tax In The Status Of Huf & Individual. The Property At Cenotaph Road, Chennai Was Given To M/S. Doshi Housing Ltd. On A Development Agreement Entered Into On 30.01.2006 Through A Power Of Attorney. The Assessing Officer Has 2

For Appellant: Shri R. Viswanathan, CAFor Respondent: Shri G. Johnson, Addl. CIT

Section 143(3)Section 147Section 148Section 54F

Officer issued notice under 148 of the Income Tax Act, 1961[“Act” in short] on 07.03.2016 on the ground that there is an escapement of income. The reasons recorded and communicated to the assessee are extracted as under: “During the relevant previous year, the assessee sold ... exempt from tax. Subsequently, on the same facts and materials available on record, the Assessing Officer came to conclusion that there is an escapement of income, that is capital gains on sale of property is not exempt. On perusal of the orders of authorities below, we find that

Royal Palms Property Pvt Ltd., Mumbai vs. Dy. CIT-13(3)(1), Mumbai

In the result, appeal of the assessee is allowed for the statistical purposes

ITA 5933/MUM/2019[2013-14]Status: DisposedITAT Mumbai12 Oct 2022AY 2013-14

Bench: Shri Prashant Maharishi, Am Dy. Cit-13(3)(1) Royal Palms Property Pvt. R No. 229, Aayakar Ltd. Survey No. 169 Aarey Bhavan, M.K. Road, Milk Colony Goregoan (E) Vs. Mumbai-400 065 Mumbai-400 020 (Respondent) (Appellant) Pan No.Aaccr3216L Assessee By : Sh. Rohan Deshpande Revenue By : Sh. Ujjawal Chavan,Sr Ar Date Of Hearing: 22.09.2022 Date Of Pronouncement: 12.10.2022

For Appellant: Sh. Rohan DeshpandeFor Respondent: Sh. Ujjawal Chavan,SR AR

Section 143(3)

assessee to submit the reconciliation with proper evidence. The learned Assessing Officer may examine the same and then if there is an escapement of income, the addition should be restricted to that extent. Accordingly, ground no 1 of the appeal is allowed with above direction. 11. In the result, appeal

Mrs. Shakuntala J Daga, Dombivli vs. Income Tax Officer National Face Less Assessment Centre, Mumbai

In the result, appeal filed by the assessee is allowed

ITA 1920/MUM/2022[2013-14]Status: DisposedITAT Mumbai04 Oct 2022AY 2013-14

Section 10(38)Section 147Section 148

referred to any material relating to the AY 2013-14 for arriving 3 Mrs. Shakuntala J. Daga at the belief that there was escapement of income in the hands of the assessee in A.Y. 2013-14. 6. It is well settled principle of law that the material relied upon ... Assessing Officer should have a live or proximate link with escapement of income. It was so held by Hon'ble Delhi High Court in the case of Amsa India Pvt. Ltd. Vs. CIT (WTC 5143/2005) and also in the case of Moser Bare India Ltd. Vs. DCIT (WPC 7677/2011 dated

Shradha Estate Pvt. Ltd, Mumbai vs. ITO 5(3) (2), Mumbai

In the result, appeal filed by the assessee is dismissed

ITA 1626/MUM/2021[2014-15]Status: DisposedITAT Mumbai03 Oct 2022AY 2014-15

Bench: Shrikuldip Singh & Shri Gagan Goyalshradha Estate Pvt. Ltd., 3, New Bake Bihari Building, 24Th Road, Khar (West), Opp. Khar Tel Ex, Mumbai-40052. Pan: Aabcs4961J ...... Appellant Vs. Ito-5(3)(2), Room No. 583, Aayakar Bhavan, M.K. Road, Mumbai-400020. ..... Respondent Appellant By : None Respondent By : Sh. Ashish Kumar, Sr. Dr Date Of Hearing : 05/07/2022 Date Of Pronouncement : 03/10/2022 Order Per Gagan Goyal, A.M:

For Appellant: NoneFor Respondent: Sh. Ashish Kumar, Sr. DR

Section 10(38)Section 131Section 143(2)

limitation. C) The information must be actionable, i.e., it must have clues/hints/directions on the basis of which AO can carry out inquiries or escapement of income is inferred. D) It should have enough material which can be called additional. E) The information must show certain transactions carried out by assessee ... information from IW and collected by AO should be tangible and should have live link with the formation of belief about escapement of income. A tangible material would mean that it is sufficient, bona fide, definite, relevant and reliable. Live link would mean direct and close nexus, a proximate

Life Insurance Corporation of India, Mumbai vs. Deputy Commissioner of Income Tax-3(2)(1), Mumbai

ITA 1671/MUM/2022[2010-2011]Status: DisposedITAT Mumbai29 Sept 2022AY 2010-2011

Bench: Shri Kuldip Singh & Shri S. Rifaur Rahmanassessment Year: 2010-11 M/S. Life Insurance Dcit 3(2)(1), Corporation Of India, Room No.608, Central Office, Aayakar Bhavan, F&A Department, Maharshi Karve Road, Vs. 3Rd Floor, West Wing, New Marine Lines, “Yogakshema”, Mumbai - 400020 Jeevan Bima Marg, Mumbai – 400 021 Pan: Aaacl0582H (Appellant) (Respondent) Assessment Year: 2010-11 Acit 3(2)(1), M/S. Life Insurance Room No.674, 6Th Floor, Corporation Of India, Aayakar Bhavan, Central Office, M.K. Road, Vs. Yogakshema, Mumbai - 400020 Jeevan Bima Marg, Nariman Point, Mumbai – 400 005 Pan: Aaacl0582H (Appellant) (Respondent)

For Appellant: Shri Anish Thacker, A.RFor Respondent: Shri Jagadish Jangid, D.R

Section 147Section 14ASection 250Section 44Section 80G

captioned AY on the basis of a mere change in opinion and without any live linkage of the impugned material with the escapement of income; 6. erred in confirming the reopening of assessment, without appreciating that the reason for reopening (i.e. basis for initiation of reopening) was only on account

Asst. Comm of Income Tax 3(2) (1), Mumbai vs. Life Insurance Corporation of India, Mumbai

ITA 1566/MUM/2022[2010-11]Status: DisposedITAT Mumbai29 Sept 2022AY 2010-11

For Appellant: Shri Anish Thacker, A.RFor Respondent: Shri Jagadish Jangid, D.R

Section 147Section 14ASection 250Section 44Section 80G

Harakh Samir Mehta, Mumbai vs. ACIT, Ward 19 (2), Mumbai

ITA 6408/MUM/2019[2012-13]Status: DisposedITAT Mumbai29 Sept 2022AY 2012-13

Bench: Shri Kuldip Singhassessment Year: 2012-13

For Appellant: Ms. Dinkle Hariya, A.RFor Respondent: Shri Anil Gupta, D.R

Section 143(3)Section 147Section 68

transactions of the hawala entries, accommodation entries by these concerns (not by the assessee) cannot lead to any conclusion of the escapement of income. The loan can be taken for several reasons and therefore, mere transactions between them cannot lead to conclusion about escapement of income. 7 Shri Harakh Samir ... such material and its relevance to the belief that is to be arrived by the officer on the basis of such material about escapement of income. Formation of such belief should have rational connection and a live link with the material. Such satisfaction cannot be based on mere suspicion

DCIT, Coimbatore vs. O.Arumugasamy, Coimbatore

ITA 777/CHNY/2017[2012-13]Status: DisposedITAT Chennai28 Sept 2022AY 2012-13

Bench: Shri Mahavir Singh & Shri Manoj Kumar Aggarwalassessment

Section 132Section 153A

April, 1989, the Assessing Officer has power to reopen, provided there is "tangible material" to come to the conclusion that there is escapement of income from assessment. Reasons must have a link with the formation of the belief.." 9. In the facts of the case, there was no tangible material ... with the Assessing Officer to come to the conclusion that there was escapement of income from assessment. Hence it is a clear case of change of opinion which cannot be the reason to come to the conclusion that there was escapement of income from assessment. Considering the facts

O.Arumugasamy, Chennai vs. DCIT, Coimbatore

ITA 763/CHNY/2017[2012-13]Status: DisposedITAT Chennai28 Sept 2022AY 2012-13

Bench: Shri Mahavir Singh & Shri Manoj Kumar Aggarwalassessment

Section 132Section 153A